RISK PROFILING QUESTIONNAIRE: ASSESSING ATTITUDE TO RISK INTRODUCTION There are several aspects to investment risk including how investors feel about risk, how much risk investors can afford to or wish to take and the risk of not meeting a particular goal or objective. Understanding an investor‟s attitude to risk will allow adviser‟s recommendations to be tailored to better meet their needs. In order to establish an investor’s attitude to risk, please complete this questionnaire
ABOUT THE QUESTIONS The questions are designed to measure risk attitude and risk personality. They are based upon the social science of psychometrics and have been created by Distribution Technology (in association with Oxford Risk, an industry leading psychometric profiling company). The attitudinal answers will be used as the basis for discussion and agreement regarding an investor‟s final risk profile. Subsequent recommendations will take your answers into account but will not have a direct bearing on any particular products or funds that may be recommended as a result.
INSTRUCTIONS 1. Record answers to all questions. It is important that this is done so honestly – there is no right or wrong answer. Please bear in mind the questions relate to the individual generally, rather than any particular investment that is being considered. 2. The answers to the questionnaire will be used by the adviser to determine an individual’s risk level based on the scoring from the questionnaire and a discussion with you about your attitude to risk, ability to take risk and risk personality.
Please note: The final selected risk profile will be an important factor in which products and funds are recommended (if any). Consideration should be given to the term over which to invest, the importance of the investment with regard to the individual‟s overall financial circumstances, and whether they can afford sustained periods of loss. If they are in any doubt about their risk profile or feel that they have not understood any aspect of this process, they should discuss the matter with the adviser before confirming their risk level.
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HOW DO YOU FEEL ABOUT RISK? CLIENT NAME:
1
Compared to the average person, I would say I take more risks
2
I would be willing to risk a percentage of my income in order to get a good return on an investment
3
To achieve high returns, it is necessary to choose high-risk investments
4
I have been extremely cautious in my past financial investments
5
Even if I experienced a substantial loss on an investment, I would not be put off making risky investments
6
I believe that it is reckless to take financial risks
7
When I'm faced with a financial decision I am generally more concerned about the possible losses than the probable gains
8
I would rather know that I was getting a guaranteed rate of return than be uncertain about my investments
9
Compared to the average person, I take lower financial risks
10
I would rather put my money in a bank account than invest in shares
11
I do not feel comfortable with financial uncertainty
12
If my investment portfolio dropped significantly in value during the first three months, it would not bother me
Strongly Disagree
Disagree
Neither Agree or Disagree
Agree
Strongly Agree
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13
I would never take a chance with any amount of money
14
I would accept potential losses in order to pursue long-term investment growth
15
I believe that the only way to make money is to take financial risks
16
Taking financial risks is important to me
17
I would be happy investing a large proportion of my income in a high-risk investment
18
I would feel comfortable investing in shares
19
How comfortable do you feel when you take a financial risk?
Strongly Disagree
Disagree
Neither Agree or Disagree
Agree
Strongly Agree
Not at all comfortable
Slightly comfortable
Moderately comfortable
Comfortable
Very comfortable
Risk averse
20
Overall, how would you place yourself on the following scale?
Somewhat risk averse
Neither risk averse nor a risk taker
A moderate risk taker
A risk taker
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PARTNER NAME:
1
Compared to the average person, I would say I take more risks
2
I would be willing to risk a percentage of my income in order to get a good return on an investment
3
To achieve high returns, it is necessary to choose high-risk investments
4
I have been extremely cautious in my past financial investments
5
Even if I experienced a substantial loss on an investment, I would not be put off making risky investments
6
I believe that it is reckless to take financial risks
7
When I'm faced with a financial decision I am generally more concerned about the possible losses than the probable gains
8
I would rather know that I was getting a guaranteed rate of return than be uncertain about my investments
9
Compared to the average person, I take lower financial risks
10
I would rather put my money in a bank account than invest in shares
11
I do not feel comfortable with financial uncertainty
12
If my investment portfolio dropped significantly in value during the first three months, it would not bother me
Strongly Disagree
Disagree
Neither Agree or Disagree
Agree
Strongly Agree
Strongly Disagree
Disagree
Neither Agree or Disagree
Agree
Strongly Agree
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13
I would never take a chance with any amount of money
14
I would accept potential losses in order to pursue long-term investment growth
15
I believe that the only way to make money is to take financial risks
16
Taking financial risks is important to me
17
I would be happy investing a large proportion of my income in a high-risk investment
18
I would feel comfortable investing in shares
19
How comfortable do you feel when you take a financial risk?
Not at all comfortable
Slightly comfortable
Moderately comfortable
Comfortable
Very comfortable
Risk averse
20
Overall, how would you place yourself on the following scale?
Somewhat risk averse
Neither risk averse nor a risk taker
A moderate risk taker
A risk taker
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HOW ABLE ARE YOU TO TAKE RISK? The following questions are not part of the psychometric attitude assessment and have no direct impact on the questionnaire results or selected risk level. However, the answers will help you and your adviser identify areas that should also be considered when assessing suitability and choosing a risk level.
Question
Response (choose one answer for each question)
1.
When do you intend to use the invested money?
Short term (0 - 5 years)
Medium term (5 - 10 years)
Long term (10+ years)
No fixed term 2.
How much of this investment could you stand to lose without having a significant impact on your future standard of living?
None or very limited losses (0 - 5%)
Small / medium losses could be tolerated Large losses would have a low impact on future lifestyle 3.
If you needed sudden access to a lump sum, how likely is it that you would need to encash this investment?
I have other savings and investments which I can use for most needs I may need this investment if I needed access to a significant amount of money quickly I would almost certainly need access to this investment
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TERMS & CONDITIONS OF USE
1. PARTIES: 1.1
In this Terms and Conditions of Use Agreement, "we", "our" and "us" means <Company Details to be Entered>
1.2
"You" means the Adviser using the Services;
1.3
This Agreement sets out the terms on which <Company Name> (“Company”) will provide the Services to you as an Adviser.
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In this Agreement, unless inconsistent with the context or otherwise specified, the following expressions shall have the following meanings: "Act"
The Data Protection Act 1998 as replaced, re-enacted, consolidated, extended, revised or amended from time to time, all subordinate legislation enacted there under and any guidance issued by the Information Commissioner or any successor;
"Adviser"
The authorised individual or firm identified to the Customer to the extent necessary and to the Regulatory Authorities as the provider of any Financial Advice.
"Applicable Regulations"
The Financial Services and Markets Act 2000, the Money Laundering Regulations 2007 (and all other legislation relating to the handling of the proceeds of crime together with the Guidance Notes for the Financial Sector issued by the Joint Steering Group and any other relevant regulations or guidance issued by any other Regulatory Authority or industry body), the Act, rules promulgated by any Regulatory Authority and any other law, regulation or code applicable in the context to the person concerned;
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Any person who is a purchaser or potential purchaser of a Financial Product or financial planning service via the Adviser.
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Any information held by you or <Company Name> or likely to come into your possession or that of <Company Name> relating to Customers which would fall within the definition of Personal Data contained in the Act;
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"Services"
The service supplied by us is a paper based risk rating assessment tool to undertake risk profiling clients, solely for the purposes of aiding the recommendation of investment strategies available via the Distribution Technology Investment Planner and / or Retirement Planner applications within the Distribution Technology Dynamic Point of Sale software. 1.1.1. The service provides information gathering, education, profiling and analysis of individuals’ financial circumstances including without limitation, documentation, information, formatted files, algorithms, data, and the "look and feel" of any of the foregoing, (whether in printed or electronic form) and all other material as well as all updates, enhancements and modifications thereof.
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Authorised advisers are permitted to print and complete this document in paper form; Access to or use of the Services is strictly limited to Advisers who have been provided access by <Company Name> to the Distribution Technology Investment Planner and / or Retirement Planner applications within the Distribution Technology Dynamic Point of Sale software and who access the Services solely within the UK. Where such access by <Company Name> is withdrawn or suspended, or where Distribution Technology suspends access to <Company Name> all rights granted to you under this Agreement immediately cease.
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By using the Services, you warrant that you have the authority to commit you and your Organisation to this Agreement and that you consent to be bound by the terms and conditions of this Agreement. If you do not wish to be bound by these terms and conditions, do not use the Services.
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As from the acceptance of this Agreement you may use the Services, subject to suspension and/or termination as set out in this Agreement.
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Access to the Services is limited to printing and completion of the risk profiling tool in paper form solely for use with the Distribution Technology Investment Planner and / or Retirement Planner applications within the Distribution Technology Dynamic Point of Sale software, and you are not permitted to use the intellectual property within this document in any other documentation without the express written permission of Distribution Technology.
3.5
Advisers may access the Services solely to provide information, education and analysis for their Customers.
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You agree and acknowledge that the provision of the Services by Distribution Technology shall not be construed or interpreted to mean the provision of Financial Advice from us to Advisers or Customers.
4.2
Advisers are responsible for all Financial Advice provided to Customers. It is an Adviser‟s responsibility to ensure that the Services provided by us meet their obligations as a provider of Financial Advice. <Company Name> and / or Distribution Technology will not be responsible to the Customer, Adviser or to the Regulatory Authorities for any Financial Advice provided.
4.3
As an Adviser you warrant that you are duly authorised in accordance with all Applicable Regulations to provide services (including the giving of Financial Advice) to Customers and shall, in performing your obligations under this Agreement, comply with all Applicable Regulations. Further, you will take all appropriate steps to obtain any further regulatory approvals that may be required from time to time.
4.4
You acknowledge that Distribution Technology is not authorised by the Financial Services Authority to provide Financial Advice.
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5.2
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5.3
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5.4
You shall: (a) not attempt to obtain access to copy, alter, reverse-engineer, decompile, translate, disassemble or separate the components of the Services ; (b) ensure that the Customer Data will not contain anything which is libellous, indecent, obscene or defamatory or otherwise unlawful; (c) perform your obligations under this Agreement with reasonable care and skill; (d) except as is set out in this Agreement or as is otherwise permitted by law you are strictly forbidden from using the Services in any circumstances, and without limitation, shall not sub-contract, sub-license or resell the Services.
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6.2
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6.5
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6.6
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You warrant to <Company Name> that you have (where required by law) notified under the Act and will maintain such notification for the duration of this Agreement. Further: (a) you will protect such of the Customer Data as constitutes Personal Data in accordance with the provisions and principles of the Act. (b) you will indemnify <Company Name> and Distribution Technology against all claims and proceedings and all liability, loss, costs and expenses incurred in connection therewith made or brought by any person in respect of any loss, damage or distress caused to that person by breach of the provisions of this clause or the Act by you the Adviser, your staff or agents.
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7.2
The Services may include third party information. A reasonable number of copies of this information may be used and printed by Advisers in their normal course of business or by an Adviserâ&#x20AC;&#x;s Customer in relation to an analysis of their own finances however, they are not permitted to: (a) manipulate the information other than enabled by the Services; (b) use any portion of the information as source material or factual content to create original content for publication; (c) re-distribute any information to any third party (with the exception of Advisers to their Customers); (d) reverse engineer the Services or access the information except via the Services.
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7.4
The content and information within the risk assessment tool is subject to change and may be updated from time to time.
7.5
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The rights and obligations of the parties which expressly or by implication are intended to continue after termination of this Agreement shall survive and continue to bind the parties, their successors and assigns.
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www.distribution-technology.com 20 Questions Paper Based Risk Profiler Client and Partner Version Document reference Issue date
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